0
0
0

South Florida’s Commercial Market Attracting Investors and Developments

by Kathryn June Ryan

rsz_miami_aerial_01

Creative Commons: Towpilot. https://commons.wikimedia.org/wiki/File:Miami_aerial_01.jpg

The high demand in South Florida’s commercial real estate market is resulting in low vacancy rates and a number of major developments in an array of sectors. This was the discovery made by local experts at the third annual Miami Association of Realtors Commercial Alliance Midyear Update in Coral Gables. Five of South Florida’s top real estate professionals discussed Miami’s booming retail market.

Local developments in multifamily, capital markets, industrial and office sectors were also presented by the Miami Association of Realtors (MIAMI). Barbara Tria, the 2015 commercial president of the association, shared her thoughts on the causes for this real estate boom.

“South Florida’s diversified economy as well as its reputation for being one of the world’s top global cities is encouraging more investors and global financiers to create leading commercial projects here,” Tria said. “The speakers at the third annual RCA Miami Midyear Commercial Update showed just how strong our local commercial market is performing, and where it will be in the coming years.”

According to a recent National Association of Realtors (NAR) and Reis Inc. report, Miami has the 15th lowest retail vacancy rate among major U.S. cities. Miami’s local market’s retail vacancy rate is 6.3 percent, while the national average is nearly 1.5 times that at 9.6 percent.

Miami’s industrial vacancy rate of 5.3 percent in May 2015 is the third-lowest in the nation among major cities, according to NAR and Reis. Christopher Sutton, vice president of business development for real estate company Flagler discussed escalating demand in the local industrial market, while Diana Parker, senior vice president of brokerage and office properties at CBRE, spoke about office vacancy rates. Those rates dropped to 13.5 percent in the first quarter of 2015. Overall rental rates have increased 3.5 percent in the first six months of 2015.

Statistics show that more 360,000 residents relocated to South Florida between 2010 and 2014, making it the sixth-fasting growing metropolitan area as said by Gerard Yetming, CBRE’s senior vice president of investing properties and multi-housing. In the first quarter of 2015, Miami-Dade County had a 3.4 percent vacancy rate in apartments with a year-over-year rental rate increase of 5.9 percent. The current rate of condo completion is well below that of the peak in 2008 while values of condos have returned to peak levels, Yetming said.

During the Commercial Alliance Midyear Update, Manny de Zárraga, the executive managing director for Holliday Fenoglio Fowler, spoke about capital markets and how high demand for quality assets combined with low interest rates continues to compress cap rates.

“South Florida is seeing additional demand for assets from global markets. Several sovereign wealth funds, including China, have a mandate to invest in American real estate.”

Not only is Miami’s real estate market booming, but the hospitality market is thriving with record hotel sales. Miami has the nation’s second-best performing hotel industry behind New York City.

Read More Related to This Post

Join the conversation

New Subscribe

  • This field is for validation purposes and should be left unchanged.